Largest State Tax Cut
In US History Passes House
The Texas House and Senate have been negotiating how best to deliver record property tax reform and relief to Texans.
The months-long negotiations were centered around three primary actions:
1. Compress, or buy-down, school district tax rates.
2. Expand the homestead exemption.
3. Reform appraisal district operations and policies.
Throughout the negotiations, there have been different iterations of each. But, AT LAST, a deal was reached between the two bodies!
Just a few minutes ago, I helped pass an $18 billion tax relief package! This legislation is not only the largest tax cut in Texas history, but the largest state tax cut in the history of the United States! Specifically, the legislation:
- Increases your homestead exemption from $40,000 to $100,000 (and $110,000 for seniors and disabled Texans). That means, you will not pay school property taxes on the first $100,000 in taxable value on your home.
- Invests billions to compress (or buy down) school district property taxes. Schools are funded through a combination of local property taxes and state dollars. Rate compression means your local school district charges you less in property taxes but stays whole when the state makes up the difference. So, you pay less in property taxes because the tax rate is reduced to a new ceiling that cannot be raised at the local level.
- Reforms appraisal district boards by adding three positions at each local Central Appraisal District to be directly elected by the people. A massively underrated reform, this will create oversight and accountable at each CAD directly from the voters in each county!
The AVERAGE homeowner savings from this package totals $1,373 annually!
Small businesses will also see relief in the legislation. In addition to a Franchise Tax Cut, they will have appraised value caps similar to that of homestead properties. For example, homestead properties currently have a 10% cap on taxable value growth. Previously uncapped, properties valued under $5 million, including residential rental properties, will now have a 20% taxable value cap per year.
Whether this legislation passed in May or in July, the net effect for the taxpayer is the same. I’m glad we took the time to get this right and continued negotiating in good faith on what is a HUGE win for the taxpayer. Thank you so much for sending me to Austin to work on this important relief package!
In depth with Rep. Patterson
Last week, I sat down with The Texan News to discuss The READER Act, Property Tax Relief and other issues – including, my philosophy on governing and advancing the conservative agenda through “effective conservatism”. Check it out here!
Thank you so much for the opportunity to serve you in your Texas House. It’s an honor and a blessing to deliver results like these back to you.